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Inter partes review (IPR): an alternative pathway for biosimilars

A “biosimilar” is a biological product, e.g., a therapeutic antibody, that is not only highly similar to an existing FDA-approved biological product (“the reference product”), but also exhibits no clinically meaningful differences from the reference product in terms of safety, purity, and potency.1 Biosimilars are similar to generic pharmaceuticals in that they can be brought to market by relying, at least in part, on the clinical trial information developed with the reference product.2 However, two important differences between biosimilars and conventional generic pharmaceuticals are that biosimilars, and the reference products they relate to, are far more chemically complex than conventional pharmaceuticals; and biosimilars are generally derived from living cells, e.g., animal, yeast, and human cells, and are thus unlikely to be “exact copies” of their respective reference products. In light of these differences, a new approval process for resolving patent-related issues has been implemented in the U.S.3Despite the creation of this new dispute resolution process, there are likely to be situations where inter partes review (IPR) may be viewed as an attractive alternative pathway for resolving patent-related issues.

The new process for resolving patent-related issues with biosimilars is outlined in the Biologics Price Competition and Innovation Act (BPCI Act). While we have yet to see this process in action, it is at the center of a dispute relating to the FDA’s March 6, 2015 approval of the first biosimilar product in the U.S., Sandoz’s Zarxio. The reference product relied upon by Sandoz for approval of Zarxio is Amgen’s Neupogen (filgrastim), which was originally approved by the FDA in 1991. However, in pursuing its approval for Zarxio, Sandoz did not engage in the process outlined in the BPCI Act for resolving patent-related issues with Amgen, leading to Amgen filing suit.

If a reference product is patent protected, e.g., by claims to the product itself, or to methods of preparing, purifying, manufacturing, formulating or using the molecule, then submitting a biosimilar application (known as a Biologics Licensing Application or “BLA”) under the BPCI Act may lead to patent litigation. In particular, the BPCI Act includes a series of provisions where the biosimilar applicant and the reference product sponsor engage in a complex patent information exchange process.4 The process begins with the biosimilar applicant sharing its BLA and relevant manufacturing information with the reference product sponsor. Once the reference product sponsor receives the BLA and relevant manufacturing information, it is to provide the biosimilar applicant with a list of patents that the reference product sponsor believes are infringed. The biosimilar applicant is then to provide to the reference product sponsor with statements describing why each listed patent is either not infringed, invalid, and/or unenforceable, after which the reference product sponsor provides reciprocal statements describing why each patent will indeed be infringed.5 Both parties then negotiate to arrive at a list of patents that will be subject to a patent infringement action.6 With respect to Zarxio, Amgen has sued Sandoz for failing to engage in the patent resolution framework outlined in the BPCI Act, i.e., in failing to provide Amgen with a copy of the Zarxio BLA or its manufacturing information.7 Sandoz has filed counterclaims arguing that the patent information exchange process is not a mandatory prerequisite to FDA review and approval of a BLA, and the BPCI Act gives a biosimilar applicant an option either to share the BLA and manufacturing information with the reference product sponsor or to face an action under 28 U.S.C. § 2201 for a declaration of patent infringement.8 On March 19, 2015, the California federal district court issued an order denying Amgen’s motion for preliminary injunction to forestall market entry of Zarxio.9 The court held that compliance with the patent information exchange process “allows an applicant to enjoy a temporary safe harbor from litigation,” however, the BPCI Act “contains no stick to force compliance in all instances”.10

Given the costs and time associated with the patent information exchange provisions, biosimilar applicants may, like Sandoz, wish to pursue a different pathway to challenge the validity of a patent. For example, a biosimilar maker may desire to address a reference product manufacturer’s patents in a declaratory judgment action arguing that the patents in question are invalid or otherwise not infringed. However, in Sandoz v. Amgen, No. 2014-1693 (Fed. Cir. Dec. 5, 2014), a case relating to Sandoz’s intention to develop a biosimilar of another one of Amgen’s products, the Federal Circuit found that no controversy existed between the parties prior to the filing of a biosimilar application for FDA approval.11 In light of the Federal Circuit’s decision inSandoz, post-grant review procedures where there is no case or controversy requirement, e.g., IPRs, are likely to gain importance as a potential means for biosimilar makers to obtain some degree of patent certainty ahead of filing a BLA.

IPRs offer a number of advantages over district court litigation. For example, the burden for proving invalidity in IPRs (“preponderance of the evidence”) is significantly lower than that in district court litigation (“clear and convincing evidence”). IPRs also generally offer faster resolution given that the entire process from petition filing to a final written decision from the Patent Trial and Appeal Board (PTAB) will generally take from 18 to 24 months. Speedy resolution not only often promotes earlier settlement than would be reached in lengthy district court litigation, but also can decrease costs as compared to litigation. Finally, IPRs are decided by Administrative Patent Judges with significant patent experience and often with technical backgrounds, who are likely to be well-suited to understand the complex technologies involved with biologic products.

Of course there are also limitations to IPRs. For example, IPRs can only be brought based on anticipation (35 U.S.C. §102) or obviousness (35 U.S.C. §103) challenges and only based on patents and printed publications. IPR petitioners are also estopped in any later litigation actions from relying on prior art that was raised or reasonably could have been raised in the IPRs. Nevertheless, for those seeking an alternative to the BPCI Act’s new pathway for patent-related dispute resolution, IPRs may be an effective strategy.

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